The pensions ‘quadruple lock’ is not an attack on the young

As the UK Labour Party cuddles up to the youth with a cynical pledge to give votes to schoolchildren, the ailing Tories have doubled down on the grey vote, promising further protections to the state pension via the ‘triple lock plus’, or ‘quadruple lock’. Yes, this may be a shameless bribe from Sunak and Co. But does that mean it’s actually a bad thing? Or that it’s a bung to the old, at the expense of the young?

The triple-lock system, introduced in 2011, means that the state pension increases in line with whichever is the highest of three measures at a given time: inflation, the average increase in wages or 2.5 per cent. The aim is to ensure that the value of the state pension is not overtaken by cost-of-living increases, or by a rise in the income of the working population.

The Conservatives have now promised to raise the threshold at which pensioners start paying income tax each year so that it stays ahead of the state pension. This, it should be said, is partly to compensate for the impact of the Tories’ own sneaky ‘fiscal drag’ policies – these have frozen tax thresholds while wages continue to rise, ‘dragging’ people into higher tax brackets.

There may be technical reasons to criticise the triple-lock mechanism. But these hardly explain the depth of outrage it provokes among those determined to present it as evidence of an ongoing ‘generation war’ by the old on the young.

The outrage emanates from the divisive narrative of Boomer-blaming. This assumes that all pensioners are wealthy homeowners and the beneficiaries of generous pension schemes, destined to live out a long and healthy retirement on the golf course, while their children slave under the burden of low wages, rising house prices, student-loan debt and the myriad other miseries associated with being young(ish) in Britain today. Posed in these terms, the pensions debate takes on a zero-sum quality: everything that the elderly are given is treated as public funding that has been taken away from the young.

As I have argued previously on spiked, it is very difficult to have a sensible discussion about pensions when it is sucked into this ageist frame, which distorts important truths about the fortunes of old and young alike.

Today’s pensioners are not sitting in the lap of luxury. Moreover, any reduction in support for the pensioners of today is likely to hit the pensioners of tomorrow even harder. In a useful explainer from 2023 on the ‘pensioner-poverty time bomb’ for the Joseph Rowntree Foundation (JRF), Helen Barnard notes that poverty levels have been rising over the past decade. The trajectory is likely to get worse, for the simple reason that the economic pressures affecting younger people – housing costs, rises in the cost of living, occupational pension schemes that do not allow for a comfortable retirement – also affect many older people.

Across the generations, people understand this. That’s why attempts to make out that something like the ‘triple lock’ is a gerontocratic conspiracy don’t wash with the general public. People don’t want grandma to get clobbered, and they realise that protecting their grandparents’ interests is the best way to protect their own.

For those of us in middle age and younger, pension reforms that have already happened, such as the raising of the retirement age, mean a retirement that is now further away and looking quite precarious. A recent YouGov poll found that 61 per cent of people aged between 25 and 49 think that their pension would not be enough to provide them with a good standard of living. Another YouGov poll showed that across all age groups, more people think that the Conservative plans to help pensioners ‘don’t go far enough’ than go ‘too far’.

Predictably, older people are more likely than younger people to worry that the quadruple lock doesn’t go ‘far enough’. But that’s because they are more likely to be thinking about their pensions at all. Among respondents aged between 18 and 49, 44 per cent said they ‘don’t know’ what they think about the Tories’ plans. That, at least, is honest. Pension provision is a fiendishly complicated policy problem, particularly in an ageing society with an ailing health and social-care system, and a stagnant economy that is struggling even to motivate people to work. To grapple with pensions, we need to stop thinking about it as an ‘old people’s issue’, and think about its broader social significance. This means having a more positive, and realistic, idea about the importance of both work and retirement.

Pensions are not just another benefit. They are better understood as part of a salary – something that people accrue over their years of working. But this also means recognising that work is a social activity – that through working, we are contributing to the shared national wealth, from which retirees can draw a pension. It also makes the principle of collectivised risk – which is what lies behind the state pension – possible. None of us knows how long we will live, so we pool our resources as workers to support others in retirement, expecting that younger generations will do the same for us.

For this to work, people need to have expectations of a half-decent retirement – and know when it will happen. We live a lot longer than people did in the 1940s, when the state-pension age was set at 65 for men and 60 for women. Given today’s sixtysomethings are generally in better health and women are more likely to be in paid work, a rise in the retirement age and an equalisation of the pension age between men and women are not unreasonable policy changes. But if younger workers see no clear end in sight to their own working lives, they are less likely to see themselves as future beneficiaries of pensions, and will be more reluctant to save for their own retirements – let alone contribute to anybody else’s.

A one-sided focus on reducing the ‘pensions burden’ on the public purse carries risks as well as benefits. Retired people, for instance, are an essential part of the care system for elderly relatives, their grandchildren and others in the community. The more people have to support themselves by working in later life, the less they can do to support older and younger generations, and save the state the cost of doing that.

None of these big questions are addressed in the myopic focus on the ‘triple’ or ‘quadruple’ lock, or the divisive conceit that decent pension provision means favouring the old over the young. If our society wants a more productive working population, it also needs to hold out the prospect of a decent retirement at the end of it.

This article was first published on spiked.